Psst–Wanna Buy a Counterfeit Club?

The connection between golf and the erectile-dysfunction industry, well-known to anyone who watches the game on television, apparently goes deeper than we imagined.

Last month, federal customs agents and state police raided a warehouse in Columbia, S.C., seizing $3.6 million in counterfeit pharmaceuticals, almost entirely consisting of two products endlessly pitched to the golf demographic, Viagra and Cialis.

ENLARGE

Bruce MacPherson

Agents also seized a large quantity of counterfeit golf clubs and components in the raid. In fact, a crucial tip that led to the bust was the interception a few days earlier at the Charlotte, N.C., international airport of hundreds of fake Golf Pride grips and high-end shafts, sent from China and packaged for delivery to the Columbia warehouse.

The counterfeiting of golf merchandise—clubs and balls, but also bags and apparel—is a whopping business. A working group established to fight counterfeiting nine years ago by the five biggest golf manufacturers estimates that fake golf gear approaches 10% of the legitimate market world-wide.

Big raids inside the U.S., like the one in South Carolina, are rare, however, because 95% of the U.S. counterfeit golf trade is online, with the products delivered directly to individual consumers, according to the group. Almost all of that fake golf gear is manufactured, assembled and shipped from China.

By one barometer—the amount of counterfeit goods seized—the group has had great success in recent years. Last spring, the U.S. Golf Manufacturers Anti-Counterfeiting Working Group shut down more than 200 websites selling goods into the U.S. market. Chinese authorities collaborating with the collective raided three dozen counterfeiting operations in China last year, seizing more than one million fake clubs.

"The difficulty with counterfeiting is you never know where you really stand—U.S. Customs examines only a small portion of the goods entering the country," said Joe Nauman, executive vice president for corporate and legal affairs at Acushnet, which makes Titleist balls and clubs and FootJoy shoes. "My overall sense is that the problem is as big or bigger than it's ever been."

On March 5, Nauman himself participated in a raid in China that illustrates the difficulty of finding and then shutting down counterfeiters. The sting took place in a dingy residential district of five-story apartment blocks on the outskirts of Dongguan, a city that is part of the Pearl River megalopolis extending from nearby Guangzhou to Hong Kong, 60 miles away. An overwhelming majority of the world's golf clubs are manufactured in this region. It's also the hotbed of golf counterfeiting.

The tip that led to this particular raid, the 14th in Dongguan in the past year, came from a local cop. He passed it along to private investigators that the U.S. working group employs in China. Since the neighborhoods in this part of Dongguan, which is also China's sex-trade capital, are suspicious of outsiders, the investigators had to find a local whom they could pay to provide surveillance. They then passed his intel along to China's Administration for Industry and Commerce, which coordinated the seizure with local police.

On the morning of the raid, Nauman and three others, including Stephen Gingrich, an executive from Srixon/Cleveland Golf, waited in a car a few blocks away until police secured the area. When they walked down the trash-strewn alley to the unmarked door of the counterfeiters' lair, Nauman narrowly avoided stepping on a huge dead rat.

Inside, in a space not much bigger than a three-car garage, was a single shaft-painting machine, a work station where clubs were cut to size and grips attached, and racks containing 40,000 to 50,000 shafts and 5,000 clubheads. Even valued at counterfeit levels, the seized merchandise might have sold for more than $1 million. The husband and wife who ran the operation, and lived in an apartment across the alley, employed just three additional workers.

Investigators are still trying to determine where the finished clubs were headed, but many seemed destined for retail stores in China. Six of the completed fake Callaway sets, for instance, were in Callaway bags with Callaway head covers and accompanied by a Callaway travel cover. This is how the dodgy off-course shops that cluster outside legitimate golf resorts in China, such as nearby Mission Hills, often sell counterfeit clubs to tourists. Over the last few years, the U.S. working group has been successful in pushing Chinese authorities to drive fake golf goods out of high-end malls and most legitimate retail outlets.

They have had far less success rooting out the foundries where the fake club components are made. The Chinese have hit only two foundries in the last three years. "There is still a certain level of local protectionism involved," said Nauman. "As far as we can see, there's been no slowdown in production." More than two million fake golf clubs a year enter the world market, the group estimates.

It's easy to imagine big club-forging plants as easy targets for interdiction, but in fact, counterfeiters can churn out club components in surprisingly tiny, dispersed spaces. Using a legitimate club head—or even a photograph—as a model, rapid-prototyping technology can spit out CAD files and create a master for a driver or iron head quickly and inexpensively. As for the actual foundry work, it can be done in a room as small as 20 feet by 20 feet.

From the exterior, the best counterfeit golf clubs these days can be hard to differentiate from legitimate clubs. "These guys have become very good at what they're doing," said Kerry Kabase, vice president of purchasing for Edwin Watts Golf. The old telltale signs, such as irregular paint and misshapen hosels, with glue oozing out, are less common.

At a recent golf-industry show, however, the U.S. working group displayed examples of counterfeit clubheads sawed in half, and you can see the type of irregularities that impact performance: irregular interior walls, or supposedly hollow iron-head cavities that instead are solid steel. Performance is erratic. Some fake clubs may play decently well for high-handicappers, others less so. One common flaw is inconsistent performance among irons in a set.

There are virtually no counterfeit clubs or balls sold at authorized retail outlets in the U.S., the group says. If you're shopping online, however, beware any club set whose price seems too good to be true—especially if the order will be shipped from China.

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